"Unsupported accounting entries" are the adjustments made
in accounting records to force the books to balance when they don't
add up, for example when:

an operation is negligent in tracking down and fixing imbalances
in their accounts;

money and assets are missing, stolen or being spent in violation
of the law;

government securities and guarantees are being issued fraudulently
or secretly.

In other words,
an "unsupported adjustment" is a plug figure for cash and
assets that are unaccounted for and/or disbursed unlawfully,
with no supporting records or audit trail. [Back to summary view ...]

For example, let's say the bank statement for your checking account
shows that you have an ending balance of $224 left in your account.
But your check book adds up to $524. What you should do is track down
the problem and straighten it out; if the bank has made a mistake and
shorted you $300, you could get them to find your missing money and
put it back into your account. However, if you don't want to be bothered,
you simply write an entry into your check book for "-$300"
to force your check book to to match your bank statement and call it
even. This would be an unsupported adjustment, since you have no explanation
for what happened to the money.

Let's look at an example from the Department of Defense (DoD). Let's
say a military arsenal sends the DoD its financial reports showing it
spent $1 billion, and transferred another $1 billion in planes, tanks,
and weapons from inventory that year. Along with the report, the arsenal
provides supporting documentation detailing $550 million of expenditures
and $250 million of inventory transfers. That leaves $450 million of
their expenditures and $750 million worth of planes, tanks, and missiles
undocumented, missing, or unaccounted for. The DoD accepts these unexplained
figures without documentation, and simply logs it as "unsupported adjustments"
instead of demanding a complete accounting of the cash and inventory.

In the government audits cited by our petition, what this means is
that HUD and DoD were permitting $59.6 billion and $1.1 trillion respectively
in unjustifiable and improper transactions. This is literally $59.6
billion and $1.1 trillion in public assets unaccounted for – as
in missing, misallocated, lost, and/or stolen – with no oversight,
and no meaningful effort to document or reverse those fraudulent transactions,
or to trace the missing money and assets and get them back.

Even more disturbing, the US Treasury and the Congress did not require
them to do so. Equally disturbing, the banking community that manages
government bank accounts, and the investment community that makes a
market and invests in US Treasury and Agency securities, did not require
them to do so.

What is wrong with "unsupported adjustments"?

Trillions of dollars in "unsupported adjustments" is literally
trillions of dollars in public funds, assets, or guarantees missing,
misplaced, or stolen from the government without a trace. Whether
the US Treasury or the bank where you keep your savings – it is
unethical and criminal for any institution entrusted with our money
to lose track of it with no meaningful effort to clean up their act
and get our money back. [Back to summary view ...]

Such practices are in direct violation of generally accepted accounting
practices for government agencies, the laws governing financial management
of federal resources, and the US Constitution.

Government accountants and auditors entrusted with our public funds,
reporting that they cannot account for it and they don’t see why they
should, is akin to:

your bank
manager telling you she doesn’t know how all the money in your savings
account disappeared and she doesn’t see why she should, or

the executor
of your grandfather’s will telling you he doesn’t know how all the
savings bonds being held in trust disappeared and doesn’t see why
he should, or

your stockbroker
telling you your account went from 200 shares to 5 shares with no
explanation, that’s just to be expected in a place that has so many
transactions to keep track of!

Indeed, liberal use of unsupported adjustments is a red flag indicating
serious problems in financial accountability. The ability to blankly
report hundreds of millions, or billions, or trillions of dollars as
simply "unsupported adjustments" – with no explanation
required and no credible attempts to investigate and recover the money
– provides the ideal setup for fraud. In the example of the military
arsenal in Question #1 above,

Unsupported adjustments of any magnitude represent an out of control
organization with failed operational control and failed audits –
a breeding ground for fraud and corruption.

What happens when a company fails an audit?

When a company fails an audit, we stop investing our money in it and
at some point, if it continues, we stop buying its products and services.
[Back to summary view ...]

Every financial officer of a publicly traded company knows the importance
of keeping track of their cash and assets, maintaining tight financial
controls with complete records and accurate and timely financial statements.
For companies raising capital in the US, their Board of Directors, their
Shareholders, the Stock Exchange, and the Securities Exchange Commission
(SEC) all insist on this.

Vigilant financial management and audits discourage fraud and theft,
and is what you’d expect in any honest, well-run company. Failure to
provide such financial management can result in:

Lower or
withdrawn ratings on securities, increasing the company’s cost of
borrowing or preventing them from being able to borrow, or sell stock

Actions by
the SEC and the Stock Exchanges that prevent a company from raising
capital through securities issuance, or trading their shares on a
stock exchange

Loss of insurance,
vendor credit, business partners, and customers

Allowing serious financial mismanagement to go
unchecked in a corporation, and/or allowing financial fraud and cooked books, can also
result in board members and management being held legally and personally
liable, significant losses for shareholders, and a field day for the
press.

A non-profit organization, such as a charity, school, church or synagogue,
can also be held to a high standard. These organizations can be stripped
of their non-profit status, and their board members and management held
personally liable.

A government contractor allowing serious financial mismanagement, and/or failing an audit,
can be fined penalties and even lose their contracts.

If you have ever been responsible for making up any money missing at
the end of your shift as a waitress, store clerk, gas station attendant,
or bank teller, you begin to appreciate how frightening the current
situation is: trillions of dollars are missing and no one is being held
personally accountable for our money, and no one is trying to find it.
Please take a moment to post your experience at the When
money goes missing in my company... Forum topic.

What happens when a taxpayer fails an IRS audit?

The government makes sure it gets complete information about the taxpayer's
money, and then it makes sure it gets the money – if need be it
simply steps in and takes the money by attaching salaries or seizing
assets. And, the taxpayer may be indicted, prosecuted and imprisoned.
But is the IRS internal financial management team held to the
same level of scrutiny when the IRS is audited?
[Back to summary view ...]

Imagine an American citizen telling the IRS:

“I can’t tell you how much I made last year and where it went. My
computers do not talk to each other (one of the leading excuses provided
by DoD and HUD), so I just have to guess and can not be bothered to
track down accurate numbers.”

As a US taxpayer you are responsible for accurately reporting your
financial situation, to the penny. You are expected to maintain careful
records, and keep receipts on file for at least seven years. If an IRS
audit finds that you have made a mistake, you will be required to make
up the difference plus pay interest on the amount. If the IRS finds
that you intentionally fudged your numbers, you can be charged with
fraud, fined with hefty penalties and interest, have your assets seized,
and be prosecuted, and jailed.

The US government is required by law to conform to the same standard,
but this is not taken seriously. We continue as if nothing is wrong,
buying government securities, paying our taxes, and using US currency.
We continue to reelect representatives who take no action to enforce
the law in the government agencies or the US Treasury, and who continue
to appropriate funds to those agencies. The bureaucrats who run these
systems continue to get their salaries and cash bonuses. The contractors
running their faulty accounting and computer systems continue to get
paid hundreds of millions of dollars, and continue to get new contracts.
And their investors continue to make money on their stocks. Hence, everyone
involved keeps getting their paycheck, their cash bonuses, their stock
options and stock profits.
[Back to summary view ...]

By law, the US government is theoretically
held to a similar standard of financial accountability as corporations
and individuals. According to the US Constitution:

"No money shall be drawn from the Treasury, but in consequence
of
appropriations made by law; and a regular statement and account of
receipts and expenditures of all public money shall be published from
time to time."
– US Constitution, Article I, Section
9

By law, each federal agency and department is required as a minimum
to balance its books at the close of each fiscal year and to submit
audited financial statements. However, both Congress and the White House
have continued to appropriate and pay government officials, bureaucrats,
and government contractors who plug in any dollar amount under the category
“unsupported adjustment” with literally no consequences (ref. ‘High
Risk’ Finance at the Federal Level, Insight Magazine, August 2003).

To date, Congress has not held them accountable, instead has given
them even more money and guarantees without making it conditional on
minimal standards of financial performance and compliance with the law.

Investors have yet to shut off market access for US Treasury and agency
securities as well as GSE, FDIC Insured, and other related mortgage
and banking debt that depends on the federal credit. Investors have
not yet incorporated the risks of this breakdown of internal financial
controls into their pricing of the US dollar, US Treasury and agency
securities, or related public and private credits.

In short, when private companies and organizations fail to manage their
finances properly, they lose their access to other people’s money. Whereas
the federal government, whose finances are worse by far, continues
to collect taxes and issue significant amounts of securities – borrowing
trillions of other people’s money. In part, this has been permitted
because the US dollar has functioned as the global reserve currency.
That is, investors assume that the US can print more money to fund the
drain of fraudulent or cooked federal accounts, and so they are not
concerned.

What’s going on here?

The US government hires accountants and financial managers and executives
with the same qualifications as corporations do. These are professionals.
They are not stupid, lazy, or incompetent. The US government spends
a fortune on accounting systems and financial managements systems, probably
more than corporations do.

Any professional knows to keep detailed records, receipts, and supporting
documentation for each transaction, with or without the fancy computers.
If/when the computers fail, they can always go back to the paper trail.
And any professional entrusted with the safekeeping of cash and assets,
whether a bank teller, executor of a will, stock broker, or an accountant
in public office, should be held to the same level of impeccable accountability.

The main difference between the professionals in the corporate sector
vs. the government sector seems to be the federal powers of taxation
and credit. As long as the federal government can tax and borrow, and
the federal reserve can print fiat currency in the face of a serious
absence of internal financial controls, investors in the US dollar,
US Treasury and agency securities, and related credits appear willing
to finance the US government.

This raises serious questions regarding the relationship to those benefitting
from the breakdown of financial controls, and those financing the government
– indeed are they one and the same?

Whether the missing trillions represent internal political pressures,
sloppy operating procedures, and/or outright theft, the US government
is entrusted with trillions of tax dollars and investors’ monies each
year and must be held accountable for that money, as well as for all
securities and guarantees issued.

Who is responsible?

Under the US Constitution, we are responsible. We elect representatives
and it is our job to hold them responsible and accountable. We pay taxes
and it is our job to find enforcement mechanisms if our tax money is
being used improperly or illegally. We have allowed our top government
officials to pass the buck or turn a blind eye. And we have let the
bad guys keep all the accumulated loot and power that belongs to us,
the people.
[Back to summary view ...]

What are these enforcement mechanisms? By
law, the Inspector General within each US government agency and department
is required to balance the books agency-wide according to the ending
balance provided by the US Treasury, and to produce an audited financial
report (see for example DoD
FY2001 and HUD
FY1999). The General Accounting Office is required to review the
audits on behalf of Congress (reference GAO
Report 2000), and the Treasury then prepares a government-wide financial
statement called the Consolidated
Federal Funds Report, as well as its own US
Treasury Performance and Accountability Report. Congress authorizes
budgets and appropriations, along with guidelines and laws governing
the use of the money appropriated. The President as Chief Executive
is responsible for hiring and firing the agency directors through political
appointments. The Department of Justice is responsible for investigating
irregularities. Informally, the press as the "Fourth Estate"
is expected to keep the public informed of fraud, corruption, and/or
financial malpractice, and dig for answers. And the taxpayer, who sends
in hard-earned money and elects their representatives, is expected to
demand accountability.

Where is the leadership? See Who's
in Charge of the Missing Money for a current list of government
officials (elected and otherwise) in the chain in command – the
officials who are directly responsible to ensure that our resources
are properly managed, to find any missing money, to get it back, and
to hold accountable those who have been incompetent or criminal.

Where are
the checks and balances?

How is it that each and every professional bookkeeper, accountant,
finanacial manager, chief financial officer, inspector general, and
auditor within each of these agencies is letting this happen, passing
it through their offices virtually unchallenged?

How is it that each and every manager, department head, division
chief, and agency director is signing off on these financials?

Why aren’t the Government Accounting Office (GAO) or the US Treasury
pressing for answers and corrective action?

Why aren’t Congress or the White House stepping in to straighten
out this mess?

Why aren’t the FBI or the Department of Justice investigating these
transactions?

Why isn’t the press having a field day?

Why aren’t the ‘shareholders’ in the form of taxpayers, voters,
investors, or anyone dependent on the US financial system anywhere
in the world screaming about this?

Part of what we are witnessing is the slow but steady corruption of
our financial system over many years, as more and more organized crime
activity involving the complicity of government-generated profits has
bought up our corporate, banking, and political infrastructure. (For
background articles, see The
Myth of the Rule of Law, Narco
Dollars for Beginners, and The
American Tapeworm).

Citizens
Watch with Place Based Accountability

Ultimately, responsibility lies with a watchful citizenry. However,
to understand what is happening, citizens require financial information
conformed to the world they see and live in – place based financial
disclosure. With place based data you can look at how money is being
taxed and used in a particular area, for example where you live, work,
or do charity work. You could then work with your representative(s)
to reengineer and optimize those funds to ensure the recipients truly
benefit. Or you could look up the sources and uses of government funds
in your representatives' district as part of monitoring their performance
and effectiveness. Surprisingly the current government accounting practices
do not allow you to see what's happening in your place.

On the other hand, with the advent of computers and the telecommunications
revolution, large corporations, banks, and governments have created
powerful new tools that help them understand "how the money
works" in each of our neighborhoods and communities. At the same time,
citizen's access to data and knowledge about local government
investment has diminished. The federal government has supported
this shift in "financial smarts" into large private financial interests
by sabotaging efforts to provide citizens with easy, understandable
access to financial disclosure for their place. (See On
the Money Trail and Where
is the Collateral?).

Transforming our financial system in a more healthy direction will
require citizen owned and controlled disclosure of local financial and
economic information. (See Solari
& the Rise of the Rule of Law.)

To do so will require illuminating the real deal on "how the
money works" – investigating the relationships between who
has been financing our government, who has been managing our government
as government contractor and depository, and who has been engaging in
financial fraud and stealing our money.

Why zero in on DoD, HUD, and Treasury ... what about the others?

This is simply where our research began. Send resources, and we will
keep going! We do know that 20 federal agencies have been cited for
seriously unreliable financial systems, and given the breakdown in checks
and balances throughout Congress, Treasury, Justice, and the oval office,
we suspect this might be government-wide.
[Back to summary view ...]

In June 2001, Sen. Fred Thompson (R-Tenn.), then ranking minority
member on the Senate Governmental Affairs Committee (now retired), issued
the two-volume report Government
at the Brink, where he states, "The waste, fraud and abuse reported
to the Governmental Affairs Committee each year is staggering. Of course
no one knows exactly how much fraud, waste and mismanagement cost the
taxpayers because the federal government makes no effort to keep track
of it." For highlights and analysis of this report and others, see Wasted
Riches, by Kelly O'Meara, 10/01).

According to Congressman Steve Horn (R-Calif.), then chairman of the
House Government Reform Subcommittee on Government Efficiency, Financial
Management and Intergovernmental Relations (now retired), who issued
an annual financial management report card for each agency, the government
went from a C- to a D overall, and the DoD failed completely (reference
Lawmaker
lowers government's financial management grade, GovExec, 4/9/02,
and Government
Management Scorecard, GovExec, 2/4/02).

According to the Government Accounting Office report titled Major
Management Challenges and Program Risks -- Governmentwide Perspective
(1/01), although 15 out of 24 agencies have now received a "clean"
audit opinion on their annual financial statements (ref. page 14/16),
"many agencies have only been able to obtain unqualified audit
opinions through heroic efforts, which include using extensive ad hoc
procedures and making billions of dollars in adjustments to derive numbers
as of a single point in time -- the end of the fiscal year. [...] The
fundamental problem is that these agencies' financial systems cannot
dependably and routinely produce annual financial statements and other
information needed to manage day-to-day operations. [...] 21 of 24 major
agencies' financial systems do not comply substantially with fedeal
accounting astandards or financial systems and other requirements."
(page 16/18). See GAO's
Performance, Accountability, and High Risk Report for a detailed
breakdown for each of the these agencies.

As for particular agencies, we
have seen reports of monies missing at the Department of Education,
and the Indian Trusts at the Department of Interior (see Billions
of dollars needed to fix Indian trust fund mess, 7/02), as well
as allegations about money missing at other agencies, but researching
these will require additional resources.

Both the figures used in the Petition
homepage – the DoD's $1.1 trillion in FY 2000 used in the
counter, and HUD's $59.6 billion in FY 1999 – are from unsupported
adjustments reported in one single year.

For accounting errors to be legitimate, they must be subject to a
materiality standard -- a standard rule of thumb dictating
whether errors are immaterial (acceptable) or material (unacceptable).
A standard of 1-3% of an operation's budget could be argued as immaterial.
Hard to say that about adjustments that are greater than 100% of the
annual budget! And in any case no amount is "immaterial" to
the people and living things that are suffering due to lack of funds
for important federal programs.
[Back to summary view ...]

If there is a citizen who cannot get health care or a decent education
for his or her children, or there is a toxic waste dump that cannot
be cleaned up for lack of funds, it is material to them to get this
money back and put it to a lawful and beneficial governmental purpose.

The needs that are going unfunded are material to the people and living
things that are suffering or dying for lack of resources. Hence, we
believe that the materiality standard that should be applied is whether
or not the amount of money is material to the taxpayers who have to
work to earn it or the people and places that are foregoing a useful,
lawful investment.

Money and assets do not disappear "out there" somewhere.
Each dollar and asset flows through an office or base somewhere, where
people work, people like you, and where some people also steal. In a
work environment that lacks basic accounting and inventory controls,
where outrageous unsupported adjustments are not seriously investigated,
the likelihood of serious criminal activity is very high. Consider this:
For $1.1 trillion to go unaccounted for in the DOD in one year, one
million offices or bases would have to lose $1,100,000 each. How many
offices or bases are there? The DOD employs roughly 3.38 million people
(ref. Major Management
Challenges and Program Risks: Department of Defense, January 2001
(page 16/18)), and let's say roughly 42 people on the average work in
each office or unit. That translates to roughly 90,000 offices and units
in the DOD. So each office or unit of 42 people would have to steal
or lose track of, on the average, $12 million in one year, or $1 million
every month. Every single office/unit of 42 people, every single
month. Have you ever worked in an office or outfit where $1,000,000
went missing, every month, no questions asked? Have you ever
known anyone who worked in such an organization? Can you imagine what
kind of operation this would have to be, to support such serious mismanagement
of funds and assets, month in and month out, and not take serious measures
to investigate, recover the money or goods, prosecute, tighten controls?

Of course there is no way to tell how much of the money and assets
were actually stolen without a complete investigation. The numbers we
have cited are generated by agencies that refuse to comply with the
most basic standards of financial management. Nor do they provide sufficient
breakdown so that we could discern which items reflect cash or physical
assets, as opposed to adjustments to reverse or adjust for legitimate
accounting errors. We cannot tell where these problems are occurring
-- are they concentrated in one or two regions, or perhaps concentrated
in offices where a certain government contractor manages the accounting
and information systems?

For lack of better information, we can use the materiality standard
to make an educated guess about how much was stolen vs. legitimate errors.
To be generous, let's apply a materiality standard of 10% (!). The DOD's
budget was roughly $378 billion in 2000 (ref. Major
Management Challenges and Program Risks: Department of Defense (GAO-01-244)).
A 10% materiality standard would permit up to $37.8 billion in unsupported
accounting entries, as "legitimate.. But the DOD actually logged
30 times that amount -- $1.1 trillion in unsupported
accounting entries during FY2000 -- or close to 300% of the total budget
that year! Even if you consider $37.8 billion of that to be immaterial
(most of us wouldn't), that still leaves $1.0 trillion as material,
"illegitimate" raising red flags, warranting serious investigation,
serious efforts to recover the entire amount, backed by the full force
of the Justice system, flanked by Congress, directed by the White House.

How can we be missing more than the total budget?

This can happen when a federal government is experiencing the financial
equivalent of a coup d'etat. Our number one favorite to win is federal
credit fraud -- government insiders issuing securities or guarantees
privately or fraudulently -- combined with central bank complicity in
printing currency and manipulating the gold market. Stealing inventory
to sell, such as tanks, jeeps, and weaponry, is also a good bet. Federal
credit and inventory are physical assets that are separate from the
budget, and are generally much larger than the annual budget.
[Back to summary view ...]

Federal Credit Fraud

We can be missing more in a year than our annual total budget if the
securities and guarantee operations at US Treasury and/or agencies such
as Ginnie Mae and HUD are run in a fraudulent manner.

For example, it is theoretically possible for funds stolen in a week
or month to be cycled back in through securities private placements.
So long as the reporting of liabilities (whether debt, government guarantees,
or contingent liabilities) is not accurate and open, the amount of money
stolen would be limited only to the market's ability (including the
folks complicit in the fraud) to hold securities and the central banks
complicity or willingness to print currency.

Such a process would be very difficult, if not impossible, to achieve
without suppression of the price of gold and manipulation of the gold
market. The Gold Anti-Trust Action Committee is a group that alleges
and has brought legal action regarding such manipulation of the gold
market (see http://www.gata.org).

Inventory Scams

In the DOD, for example, a group of defense contractors who trade in
weapons, and who also happen to run the accounting and information systems
for the arsenal, can generate an ongoing fraud scam stealing weapons
out of inventory and selling them back to the arsenal, and no one will
be the wiser except the people making all the money on the fraud.

Why get alarmed now ... hasn't this been going on for ages?

When financial corruption grows into financial coup d'etat, there
is a reason to get alarmed. The house is burning down. The financial
pressure to abrogate social and political commitments increases and
the result can be a breakdown of infrastructure or violence. [Back to summary view ...]

Corruption has been going on for years. However, digital technology
and computers, combined with the power of the federal credit, have permitted
federal financial fraud to move to a new level.

There are a number of reasons to be especially concerned now. First,
the US government has financed this for many years by borrowing more
and more money globally, and encouraging other countries to adopt US
currency. We are reaching a saturation point as to how much more financing
the global markets can provide to the US.

Second, the increased power and control resulting from organized crime
profits is causing an acceleration in the deterioration of the Constitutional
protections under the law – witness the Patriot Act.

Third, we are building an economy where success is driven increasingly
by how clever both people and institutions can be at perpetrating fraud
and government corruption – at rigging markets and contracts –
rather than at fundamental productivity. This is causing a deterioration
in our culture and our economy.

Finally, we have eaten through our fat and are now eating through
our muscle. As our jobs, skills and manufacturing base are moved abroad,
Americans are left with our rising consumer, mortgage and government
debt without a way to service it. This shifts the fundamental power
from the citizens to the people and institutions that control financial
credit and capital.

There are big problems everywhere I turn … why focus on this one?

If all of your retirement savings and financial safety net can be
stolen, then you and your family are not safe. [Back to summary view ...]

America is being financially drained. We pay the government taxes.
Instead of the government using those taxes to invest in things that
make us more productive and secure, the money is being stolen and used
in fraudulent ways that harm us and cause the value of our assets to
deteriorate. In addition, the government is borrowing money recklessly
in our name, money that we and our assets ultimately collateralize.

There is a significant relationship between political freedom and
financial security. If our creditors steal our money and remain our
creditors without any effort on our part to establish their offsetting
liabilities, they will have us over a financial barrel.

The current role of the federal government and the federal credit
is slowly draining the middle class and introducing feudalism.

What does this have to do with me and my family?

The amount missing is staggering, and the implications are staggering.
Trillions of dollars missing from the US government is draining our
family and community resources like a hole in the milk bucket, where
no one is stopping to fix the hole, we just keep filling it up with
more tax dollars, and the bad guys get to keep reaping the benefits.
This is syphoning funds from much needed programs and services, jacking
up the deficit, stiffing the average citizen with making up the difference
(including hidden costs), and putting our families and communities at
risk, especially vulnerable to predatory corporate interests.
[Back to summary view ...]

While our jobs are moving overseas, our government and consumer debts
continue to escalate at home. This means serious financial troubles
for us and our neighbors, particularly if the people who stole our money
are now free to buy our land and natural resources at 10 cents on the
dollar.

As funds are juggled to make up for missing trillions, important social
and environmental protection programs are increasingly at risk. You
are paying for services that aren't provided, and living with the consequences.
Indeed, the money often is going for things that increase the power
of private interests who are using their increased economic and political
power to rig elections, rig markets, and buy up and control your local
businesses.

As regulatory and enforcement agencies are increasingly compromised
(such as Enron officials running the SEC), our personal and community
assets become increasingly vulnerable to predatory activity. Pension
funds are disappearing, community water rights are being bought up by
private concerns, etc. Instead of government protecting us
from white collar crime, it appears to be financing the white
collar criminals with our money.

Your personal and family financial security and opportunity –especially
for your children and grandchildren –may very well depend on a
successful resolution of this situation. If not depend, then it will
be significantly impacted by it.

HUD regulates Fannie Mae and Freddie Mac (currently under investigation),
which are crucial to the US financial system, since they effectively
underwrite the mortgage market, financing nearly half of all American
housebuyers, and dealing actively in bonds and other financial instruments.
Our financial system is virtually a house of cards...

Note that $50 million was spent to investigate the Clintons' failed
Whitewater real-estate deal (Dollar
Value of Select Investigations, Insight Magazine, 11/24/03), but
as far as we know, $0 has been spent to thoroughly investigate the missing
money!

Can we get the money back?

Yes, of course. We can and we must get the money back. The primary thing stopping us is the belief that we can not get it back.
[Back to summary view ...]

First of all, banks are required to keep records of all transactions.
Hence, it is theoretically possible to establish what cash came in and
what cash went out, and with it, what assets were purchased and should
be in inventory and what guarantees and securities were issued and are
outstanding. If these records have been destroyed, it is possible to
ascertain who has failed to keep proper records and who is liable. In
theory, there should be insurance or other assets standing behind these
responsibilities.

As we determine what cash or assets are missing and what guarantees
and securities have been improperly issued, it is then possible to determine
the opportunities through legal action, including seizures and offsets,
to get back the money stolen, or recover equivalent amounts.

For example, if an organization stole $1 billion,
and also holds $1 billion in US Treasury securities, we may be able
to assert common law rights of offset. You owe us $1, and we owe you
$1, so we offset. See The Solari Solution.

Significant federal asset forfeiture and seizure laws have been created
through the War on Drugs, and significant digital tools have been developed
to track flows in the banking system that make it theoretically possible
to find and take actions that will get back assets in an equivalent
amount.

If we do not get stolen money back, we will find ourselves in a position
where we will be forced to sell our land and natural resources at discount
prices to the people who stole our money. Why
be dependent on those who stole our money for capital on devastating
and expensive terms? Why not simply get our money back?

In addition, a history of federal financial fraud has taught us that
the only way to prevent this type of fraud from happening is to get
the money back. To the extent the criminals who stole the money get
to keep the money, their power only increases, and their fraud increases.
For example, the Iran Contra networks were allowed to stay intact and
to keep the money stolen from the S&Ls; this created a platform for
those people who were successful in those networks to rise to greater
power and engage in much more significant levels of fraud in the 1990s.